MERRILL LYNCH N Y MUNI BD FD OF M L MULTI ST MUNI SER TRUST
N-30D, 1995-05-12
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MERRILL LYNCH
NEW YORK
MUNICIPAL
BOND FUND

Merrill Lynch Multi-State
Municipal Series Trust




FUND LOGO




Semi-Annual Report

March 31, 1995





This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Fund unless
accompanied or preceded by the Fund's current prospectus. Past
performance results shown in this report should not be considered a
representation of future performance. Investment return and
principal value of shares will fluctuate so that shares, when
redeemed, may be worth more or less than their original cost.





Merrill Lynch New York
Municipal Bond Fund
Merrill Lynch Multi-State
Municipal Series Trust
Box 9011
Princeton, NJ
08543-9011
<PAGE>





TO OUR SHAREHOLDERS

Increasing signs of slowing economic growth led to higher US stock
and bond prices during the March quarter. Although gross domestic
product (GDP) was reported to have increased at a revised 5.1% rate
during the final quarter of 1994, declines in other indicators such
as new home sales and durable goods orders registered thus far in
1995 have led investors to anticipate that the economy is losing
enough momentum to keep inflation under control and preclude further
significant monetary policy tightening by the Federal Reserve Board.

However, as US stock and bond markets have risen, the value of the
US dollar reached new lows relative to the yen and the Deutschemark.
Persistent trade deficits and exports of capital from the United
States have kept the US currency in a decade-long decline relative
to the Japanese and German currencies. Over the longer term, since
the United States has the highest productivity among industrialized
nations and among the lowest labor costs, demand for US dollar-
denominated assets may improve. However, a reduction of the still-
widening US trade deficit may be necessary before the US dollar
appreciates substantially relative to the yen and the Deutschemark.

The first three months of 1995 were very positive for the US stock
and bond markets. Continued signs of a moderating expansion and well-
contained inflationary pressures would provide further assurance
that the peak in interest rates is behind us, creating a stronger
foundation for higher stock and bond prices. On the other hand,
indications of reaccelerating growth and further significant
monetary policy tightening by the Federal Reserve Board would be a
decided negative for the US financial markets.

The Municipal Market
During the three months ended March 31, 1995, the municipal bond
market rallied strongly, continuing the improvement it showed at the
end of 1994. During the quarter ended March 31, 1995, long-term tax-
exempt revenue bond yields, as measured by the Bond Buyer Revenue
Bond Index, declined almost 70 basis points (0.70%) to 6.29%. Bond
yields declined over 100 basis points from the highs experienced in
November 1994 and are now lower than they were a year ago. US
Treasury bond yields exhibited similar declines in recent months.
Thus far in 1995, the 30-year US Treasury bond yield has fallen
approximately 50 basis points to 7.43%.
<PAGE>
Tax-exempt bond yields declined more than their taxable counterparts
so far in 1995 largely because of the dramatic decline in new
municipal bond issuance in recent quarters. During the March 31,
1995 quarter, less than $30 billion in new long-term municipal
securities were issued, representing a 45% decline in issuance
compared to the March 31, 1994 quarter. Similarly, over the past six
months, less than $75 billion in municipal bonds were issued, a
decline of approximately 50% versus the comparable period a year
ago. Issuance was particularly low during January and February with
monthly volumes of less than $8 billion. These levels are the lowest
monthly totals since the mid-1980s.

Both institutional and individual investors saw significant cash
inflows in recent months. These cash flows were derived from regular
coupon payment, bond maturities and the proceeds from early bond
calls and redemptions. Investors received approximately $20 billion
in principal redemptions and coupon income during January 1995. With
monthly issuance in the $7 billion--$10 billion range, the current
supply/demand imbalance dominated the municipal market, and bond
prices have risen accordingly. The tax-exempt bond market's
technical position is likely to remain strong throughout most of
this year. We estimate that investor proceeds from all sources will
exceed $200 billion during 1995. Estimates of total bond issuance
for this year continue to be reduced with most estimates currently
in the $125 billion range. Investors should find it increasingly
difficult to replace existing holdings as they mature and reinvest
coupon income in such an environment.

However, despite their strong technical position, municipal bonds
remain an attractive investment alternative. At current levels, long-
term municipal revenue bonds yield over 84% of the US Treasury
bond's yield. Municipal bond yields are usually considered
attractive whenever the yield ratio exceeds 82%. For example, to an
investor in the 39% Federal income tax bracket, municipal revenue
bonds currently yield in excess of 10% on a tax equivalent basis. As
municipal bonds become increasingly scarce during 1995 and beyond,
currently available tax-exempt bond yields should be attractive to
long-term investors.

Portfolio Strategy
Signs of a slowing economy were not evident at the beginning of the
March 31, 1995 quarter. Therefore, investors became confident that
the Federal Reserve Board's additional short-term interest rate
increases would keep inflation under control, and allow the economy
to achieve a "soft landing."

Subsequent to the early February increases in the Federal Funds and
discount rates, signs of slowing appeared in such areas as
automobile sales, retail sales and durable goods orders. Employment
continues to expand but this is sometimes viewed as a lagging
indicator.
<PAGE>
We continued to use the investment strategy we implemented at the
end of 1994: remaining fully invested and extending the average
maturity of the portfolio to enhance anticipated price appreciation
in a declining interest rate environment. We will monitor economic
releases as we move into the second quarter of 1995 to guard against
a sudden rebound in economic growth and the potential for
inflationary pressures resulting from a possible growth surge.


In Conclusion
We appreciate your ongoing interest in Merrill Lynch New York
Municipal Bond Fund, and we look forward to assisting you with your
financial needs in the months and years to come.



Sincerely,




(Arthur Zeikel)
Arthur Zeikel
President




(Vincent R. Giordano)
Vincent R. Giordano
Vice President and Portfolio Manager



May 2, 1995



PERFORMANCE DATA


About Fund Performance

Since October 21, 1994, investors have been able to purchase shares
of the Fund through the Merrill Lynch Select Pricing SM System,
which offers four pricing alternatives:

* Class A Shares incur a maximum initial sales charge (front-end
  load) of 4% and bear no ongoing distribution or account maintenance
  fees. Class A Shares are available only to eligible investors.
<PAGE>
* Class B Shares are subject to a maximum contingent deferred sales
  charge of 4% if redeemed during the first year, decreasing 1% each
  year thereafter to 0% after the fourth year. In addition, Class B
  Shares are subject to a distribution fee of 0.25% and an account
  maintenance fee of 0.25%. These shares automatically convert to
  Class D Shares after approximately 10 years.

* Class C Shares are subject to a distribution fee of 0.35% and an
  account maintenance fee of 0.25%. In addition, Class C Shares are
  subject to a 1% contingent deferred sales charge if redeemed within
  one year of purchase.

* Class D Shares incur a maximum initial sales charge of 4% and an
  account maintenance fee of 0.10% (but no distribution fee).

Performance data for the Fund's Class A and Class B Shares are
presented in the "Performance Summary" and "Average Annual Total
Return" tables below and on page 4. "Aggregate Total Return" tables
for Class C and Class D Shares are also presented below. Data for
all of the Fund's shares, including Class C and Class D Shares, are
presented in the "Recent Performance Results" table on page 5.

The "Recent Performance Results" table shows investment results
before the deduction of any sales charges for Class A and Class B
Shares for the 12-month and 3-month periods ended March 31, 1995 and
for Class C and Class D Shares for the since inception and 3-month
periods ended March 31, 1995. All data in this table assume
imposition of the actual total expenses incurred by each class of
shares during the relevant period.

None of the past results shown should be considered a representation
of future performance. Investment return and principal value of
shares will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. Dividends paid to each class
of shares will vary because of the different levels of account
maintenance, distribution and transfer agency fees applicable to
each class, which are deducted from the income available to be paid
to shareholders.



Average Annual Total Return

                                     % Return Without % Return With
                                       Sales Charge   Sales Charge**

Class A Shares*

Year Ended 3/31/95                         +4.24%         +0.07%
Five Years Ended 3/31/95                   +7.51          +6.63
Inception (10/25/88)
through 3/31/95                            +7.25          +6.57


[FN]
 *Maximum sales charge is 4%.
**Assuming maximum sales charge.
<PAGE>


                                        % Return         % Return
                                       Without CDSC     With CDSC**

Class B Shares*

Year Ended 3/31/95                         +3.71%         -0.23%
Five Years Ended 3/31/95                   +6.97          +6.97
Inception (11/1/85)
through 3/31/95                            +7.75          +7.75

[FN]
 *Maximum contingent deferred sales charge is 4% and is reduced
  to 0% after 4 years.
**Assuming payment of applicable contingent deferred sales charge.


Aggregate Total Return

                                         % Return        % Return
                                        Without CDSC    With CDSC**

Class C Shares*

Inception (10/21/94)
through 3/31/95                            +4.26%         +3.26%

[FN]
 *Maximum contingent deferred sales charge is 1% and is reduced
  to 0% after 1 year.
**Assuming payment of applicable contingent deferred  sales charge.


                                    % Return Without  % Return With
                                      Sales Charge    Sales Charge**

Class D Shares*

Inception (10/21/94)
through 3/31/95                            +4.39%         +0.22%

[FN]
 *Maximum sales charge is 4%.
**Assuming maximum sales charge.
<PAGE>


PERFORMANCE DATA (CONTINUED)

<TABLE>
Performance Summary--Class A Shares
<CAPTION>
                         Net Asset Value          Capital Gains
Period Covered        Beginning     Ending         Distributed       Dividends Paid*      % Change**
<C>                     <C>         <C>              <C>                 <C>               <C>
10/25/88--12/31/88      $10.85      $10.76              --               $0.138            + 0.44%
1989                     10.76       11.00              --                0.742            + 9.43
1990                     11.00       10.76              --                0.734            + 4.71
1991                     10.76       11.43              --                0.728            +13.44
1992                     11.43       11.74           $0.110               0.727            +10.38
1993                     11.74       12.08            0.241               0.775            +11.81
1994                     12.08       10.43              --                0.629            - 8.60
1/1/95--3/31/95          10.43       10.95              --                0.145            + 6.50
                                                     ------              ------
                                               Total $0.351        Total $4.618

                                                   Cumulative total return as of 3/31/95: +56.85%**


<FN>
 *Figures may include short-term capital gains distributions.
**Figures assume reinvestment of all dividends and capital gains
  distributions at net asset value on the payable date, and do not
  include sales charge; results would be lower if sales charge was
  included.
</TABLE>


<TABLE>
Performance Summary--Class B Shares
<CAPTION>
                         Net Asset Value          Capital Gains
Period Covered        Beginning     Ending         Distributed       Dividends Paid*      % Change**
<C>                     <C>         <C>              <C>                 <C>               <C>
11/1/85--12/31/85       $10.00      $10.34              --               $0.098            + 4.60%
1986                     10.34       11.24           $0.073               0.732            +16.95
1987                     11.24       10.44              --                0.722            - 0.79
1988                     10.44       10.76              --                0.685            + 9.92
1989                     10.76       11.00              --                0.687            + 8.89
1990                     11.00       10.77              --                0.680            + 4.29
1991                     10.77       11.43              --                0.672            +12.76
1992                     11.43       11.74            0.110               0.668            + 9.82
1993                     11.74       12.09            0.241               0.714            +11.34
1994                     12.09       10.43              --                0.573            - 9.14
1/1/95--3/31/95          10.43       10.95              --                0.133            + 6.38
                                                     ------              ------
                                               Total $0.424        Total $6.364

                                                   Cumulative total return as of 3/31/95: +101.88%**
<PAGE>
<FN>
 *Figures may include short-term capital gains distributions.
**Figures assume reinvestment of all dividends and capital gains
  distributions at net asset value on the payable date, and do not
  reflect deduction of any sales charge; results would be lower if
  sales charge was deducted.
</TABLE>


PERFORMANCE DATA (CONCLUDED)

<TABLE>
Recent Performance Results
<CAPTION>
                                                                                12 Month   3 Month
                                                3/31/95   12/31/94  3/31/94++   % Change++ % Change
<S>                                             <C>       <C>        <C>         <C>       <C>
Class A Shares*                                 $10.95    $10.43     $11.13      -1.62%    +4.99%
Class B Shares*                                  10.95     10.43      11.13      -1.62     +4.99
Class C Shares*                                  10.96     10.43      10.76      +1.86     +5.08
Class D Shares*                                  10.95     10.42      10.76      +1.77     +5.09
Class A Shares--Total Return*                                                    +4.24(1)  +6.50(2)
Class B Shares--Total Return*                                                    +3.71(3)  +6.38(4)
Class C Shares--Total Return*                                                    +4.26(5)  +6.45(6)
Class D Shares--Total Return*                                                    +4.39(7)  +6.58(8)
Class A Shares--Standardized 30-day Yield         5.12%
Class B Shares--Standardized 30-day Yield         4.83%
Class C Shares--Standardized 30-day Yield         4.71%
Class D Shares--Standardized 30-day Yield         5.02%

<FN>
  *Investment results shown do not reflect sales charges; results
   shown would lower if a sales charge was included.
 ++Investment results shown for Class C and Class D Shares are since
   inception (10/21/94).
(1)Percent change includes reinvestment of $0.637 per share ordinary
   income dividends.
(2)Percent change includes reinvestment of $0.145 per share ordinary
   income dividends.
(3)Percent change includes reinvestment of $0.582 per share ordinary
   income dividends.
(4)Percent change includes reinvestment of $0.133 per share ordinary
   income dividends.
(5)Percent change includes reinvestment of $0.238 per share ordinary
   income dividends.
(6)Percent change includes reinvestment of $0.130 per share ordinary
   income dividends.
(7)Percent change includes reinvestment of $0.261 per share ordinary
   income dividends.
(8)Percent change includes reinvestment of $0.143 per share ordinary
   income dividends.
</TABLE>
<PAGE>


PORTFOLIO ABBREVIATIONS

To simplify the listings of Merrill Lynch New York Municipal Bond
Fund's portfolio holdings in the Schedule of Investments, we have
abbreviated the names of many of the securities according to the
list at right.


AMT          Alternative Minimum Tax (subject to)
COP          Certificates of Participation
GO           General Obligation Bonds
HFA          Housing Finance Agency
IDA          Industrial Development Authority
IDR          Industrial Development Revenue Bonds
PCR          Pollution Control Revenue Bonds
UT           Unlimited Tax
VRDN         Variable Rate Demand Notes


<TABLE>
SCHEDULE OF INVESTMENTS                                                                                   (in Thousands)
<CAPTION>
S&P     Moody's    Face                                                                                          Value
Ratings Ratings   Amount                                  Issue                                                (Note 1a)

New York--93.5%
<S>     <S>       <C>         <S>                                                                              <C>
BBB+    Baa1      $  2,955    Babylon, New York, IDA, Resource Recovery Revenue Bonds (Ogden
                              Martin Systems), Series C, 8.50% due 1/01/2019                                   $   3,219

NR*     Baa1        14,750    Babylon, New York, IDA, Waste Facilities Revenue Bonds (Babylon
                              Community Waste Management), Series A, 7.875% due 7/01/1999 (d)                     16,678

                              Buffalo, New York, Sewer Authority Revenue Bonds:
AAA     Aaa          2,000     Refunding, Series G, 5% due 7/01/2012 (b)                                           1,809
AAA     Aaa          2,250     Series E, 7.75% due 7/01/1997 (a)(d)                                                2,437
AAA     Aaa          4,000     Series F, 6% due 7/01/2013 (b)                                                      4,080

NR*     Aa1          6,200    Hornell, New York, IDA, IDR (Crowley Foods, Inc.), 7.75% due 12/01/2016              6,536

                              Metropolitan Transportation Authority, New York, Service Contract
                              Revenue Bonds (Commuter Facilities):
BBB     Baa1         1,300     Series 3, 9.25% due 7/01/2000                                                       1,513
BBB     Baa1         4,330     Series 7, 5.45% due 7/01/2007                                                       4,029
BBB     Baa1         4,370     Series O, 5.75% due 7/01/2013                                                       4,089
<PAGE>
                              Metropolitan Transportation Authority, New York, Service Contract
                              Revenue Bonds (Transit Facilities):
BBB     Baa1         4,930     Refunding, Series 7, 5.45% due 7/01/2007                                            4,587
BBB     Baa1         2,350     Series 3, 9.25% due 7/01/1999                                                       2,763
BBB     Baa1         4,755     Series 3, 9.25% due 7/01/2000                                                       5,534
BBB     Baa1         3,845     Series O, 5.75% due 7/01/2013                                                       3,597
BBB     Baa1         4,000     Series P, 5.75% due 7/01/2015                                                       3,677

AAA     Aaa          2,950    Monroe County, New York, Airport Authority Revenue Bonds (Greater
                              Rochester International), AMT, 7.25% due 1/01/2009 (c)                               3,240

                              Monroe County, New York, COP:
BBB+    Baa            345     7.375% due 1/01/1996                                                                  352
BBB+    Baa          9,770     8.05% due 1/01/2011                                                                10,747
</TABLE>


<TABLE>
SCHEDULE OF INVESTMENTS (continued)                                                                       (in Thousands)
<CAPTION>
S&P     Moody's    Face                                                                                          Value
Ratings Ratings   Amount                                  Issue                                                (Note 1a)

New York (continued)
<S>     <S>       <C>         <S>                                                                              <C>
                              New York City, New York, GO, UT:
A-      Baa1       $ 5,925     Series C, 7.25% due 8/15/2024                                                   $   6,063
A-      Baa1        15,400     Series D, 9.50% due 8/01/2002                                                      18,389

                              New York City, New York, IDA, Civic Facilities Revenue Bonds:
A1+     NR*          1,500     (National Audobon Society), VRDN, 4.45% due 12/01/2014 (e)                          1,500
BBB     NR*          2,000     (New York Blood Center), 7.20% due 5/01/2012                                        2,085
BBB     NR*          6,895     (New York Blood Center), 7.25% due 5/01/2022                                        7,116
AAA     Aaa          3,890     (USTA National Tennis Center Project), 6.60% due 11/15/2011 (g)                     4,130

A1+     NR*          9,100    New York City, New York, IDA, IDR (Japan Airlines Company Ltd.
                              Project), VRDN, AMT, 4.55% due 11/01/2015 (e)                                        9,100

BB+     Baa2         2,030    New York City, New York, IDA, Special Facilities Revenue Bonds
                              (American Airlines Inc., Project), AMT, 7.75% due 7/01/2019                          2,106

                              New York City, New York, Municipal Water Finance Authority Water
                              and Sewer System Revenue Bonds:
A-      A            5,000     Series A, 6% due 6/15/2019                                                          4,844
A-      A            6,125     Series B, 6.50% due 6/15/2020                                                       6,239
A1+     VMIG1++      3,700     VRDN, Series C, 4.60% due 6/15/2022 (b)(e)                                          3,700
AAA     VMIG1++     13,400     VRDN, Series G, 4.40% due 6/15/2024 (b)(e)                                         13,400

AAA     Aaa          3,750    New York City, New York, Trust for Cultural Resources Revenue Bonds
                              (American Museum of Natural History), Series A, 6.90% due 4/01/2001 (c)(d)           4,148
<PAGE>
                              New York State Dormitory Authority Revenue Bonds:
BBB     Baa1         2,800     (City University System), Series A, 9.25% due 7/01/2000                             3,259
BBB     Baa1         7,030     (City University System), Series C, 9.25% due 7/01/2000                             8,182
BBB     Baa1         4,600     (City University System), Series F, 5.50% due 7/01/2012                             4,182
BBB     Baa1         4,700     (City University System), Series F, 5% due 7/01/2014                                3,968
A       NR*          1,065     (Community Memorial Hospital, Hamilton), 9% due 7/01/2005                           1,096
BBB     Baa1         3,500     (Consolidated City University Systems--2nd General), Series A, 5.75%
                               due 7/01/2013                                                                       3,275
BBB     Baa1        12,000     (Consolidated City University Systems), Series A, 5.75% due 7/01/2013              11,227
A1+     VMIG1++      3,100     (Cornell University), VRDN, Series B, 4.45% due 7/01/2025 (e)                       3,100
BBB+    Baa1        12,500     (Court Facilities Lease Bonds), Series A, 5.50% due 5/15/2010                      11,498
BBB+    Baa1         6,020     (Court Facilities Lease Bonds), Series A, 5.625% due 5/15/2013                      5,535
BBB+    Baa1         4,500     (Court Facilities Lease Bonds), Series A, 5.375% due 5/15/2016                      3,960
AA      Aa           3,130     (Rochester General Hospital), 8.75% due 8/01/1995 (d)(f)                            3,242
BBB+    Baa1         5,000     (State University Educational Facilities), Refunding, Series A,
                               5.25% due 5/15/2015                                                                 4,367
BBB+    Baa1         2,500     (State University Educational Facilities), Refunding, Series A,
                               5.875% due 5/15/2017                                                                2,348
BBB+    Baa1        12,000     (State University Educational Facilities), Refunding, Series B, 7%
                               due 5/15/2016                                                                      12,423
BBB-    Baa1         4,500     (Upstate Community College), Series A, 5.70% due  7/01/2021                         4,075

AAA     Aaa          7,820    New York State Energy Research and Development Authority, Electric
                              Facilities Revenue Bonds (Consolidated Edison Company), AMT, Series A,
                              6.75% due 1/15/2027 (c)                                                              8,084

                              New York State Energy Research and Development Authority, PCR:
BBB     Baa2         5,510     (New York State Electric & Gas Corp.), AMT, Series A, 5.95% due 12/01/2027          4,866
NR*     NR*          3,100     (Niagara Power Corporation Project), VRDN, Series A, 4.45% due 3/01/2027 (e)        3,100

A       Aa           7,450    New York State Environmental Facilities Corporation, PCR (Water-
                              Revolving Fund), Series A, 7.25% due 6/15/2010                                       8,053

BBB     Baa          1,500    New York State Environmental Facilities Corporation, Solid Waste
                              Disposal Revenue Bonds (Occidental Petroleum Corp.), AMT, Sub-Series B,
                              5.50% due 9/01/2003                                                                  1,487
</TABLE>
<PAGE>


<TABLE>
SCHEDULE OF INVESTMENTS (continued)                                                                       (in Thousands)
<CAPTION>
S&P     Moody's    Face                                                                                          Value
Ratings Ratings   Amount                                  Issue                                                (Note 1a)

New York (continued)
<S>     <S>       <C>         <S>                                                                              <C>
                              New York State Environmental Facilities Corporation, Special Obligation
                              Bonds (Riverbank State Park):
BBB     NR*        $ 1,485     7.25% due 4/01/2007                                                             $   1,556
BBB     NR*          2,750     7.25% due 4/01/2012                                                                 2,862

AAA     Aaa          6,225    New York State Environmental Facilities Corporation, Water Facilities
                              Revenue Refunding Bonds (Spring Valley Water Company), Series B, 6.15%
                              due 8/01/2024 (a)                                                                    6,208

BBB     Baa1        10,100    New York State, HFA, Service Contract Obligation Revenue Bonds,
                              Refunding, Series C, 5.875% due 9/15/2014                                            9,514

NR*     VMIG1++      8,785    New York State Job Development Authority Revenue Bonds, State Guaranteed,
                              Special Purpose Bonds, VRDN, AMT, Series A-1 through A-25, 4.50% due
                              3/01/2007 (e)                                                                        8,785

                              New York State Local Government Assistance Corporation Revenue Bonds:
A       A            2,170     Refunding, Series B, 5.625% due 4/01/2013                                           2,056
A       A            2,000     Refunding, Series C, 5.50% due 4/01/2017                                            1,863
A       A            2,000     Refunding, Series C, 5.50% due 4/01/2018                                            1,843
A       A           16,740     Refunding, Series E, 5% due 4/01/2021                                              14,277
A       A            3,300     Series A, 5.50% due 4/01/2023                                                       3,023
A       A            9,750     Series D, 5% due 4/01/2023                                                          8,273

                              New York State Medical Care Facilities Finance Agency Revenue Bonds:
AAA     Aaa          6,820     (Health Insurance Plan of Greater New York), Series B, 8.50% due
                               12/01/1997 (a)(d)                                                                   7,465
AAA     NR*          5,370     (Hospital & Nursing Home Insured Mortgage), Series C, 6.40% due
                               8/15/2014 (f)                                                                       5,572
AAA     NR*          2,000     (Hospital & Nursing Home Mortgage), Refunding, Series C, 5.75%
                               due 8/15/2019 (f)                                                                   1,909
AAA     NR*          1,000     (Hospital & Nursing Home Mortgage), Series A, 8.30% due 2/15/1998
                               (d)(f)                                                                              1,114
AAA     Aa           2,700     (Hospital & Nursing Home Mortgage), Series B, 8.10% due 2/15/1998
                               (d)(f)                                                                              2,988
AAA     Aaa          4,000     (Long-Term Health Care Capital Guaranty Insured), Series D, 6.50%
                               due 11/01/2015                                                                      4,129
AAA     Aaa          5,000     (Mental Health Services), Refunding, Series F, 5.375% due 2/15/2014 (g)             4,633
AAA     Aaa          8,350     (Mental Health Services), Refunding, Series F, 5.25% due 2/15/2019 (g)              7,463
BBB+    Baa1         1,215     (Mental Health Services), Series B, 7.625% due 8/15/2017                            1,307
AAA     Aaa          3,240     (Mental Health Services), Series C, 7.30% due 8/15/2001 (d)                         3,689
BBB+    Baa1         1,075     (Mental Health Services), Series C, 7.30% due 2/15/2021                             1,142
BBB+    Baa1         5,115     (Mental Health Services), Series D, 7.40% due 2/15/2018                             5,446
AAA     Aaa          2,000     (Mental Health Services), Series F, 5.375% due 2/15/2014 (b)                        1,866
AAA     Aaa          6,140     (Saint Francis Hospital Project), Series A, 7.625% due 11/01/2021 (b)               6,721
BBB     Baa         12,200     (Security Hospital), Series A, 7.40% due 8/15/2021                                 12,613
<PAGE>
AAA     Aaa         17,500    New York State Mortgage Agency, Homeowner Mortgage Revenue Bonds,
                              Series 43, 6.45% due 10/01/2017 (c)                                                 17,838

AA-     Aa          20,000    New York State Power Authority, General Purpose and Revenue Bonds,
                              Series Y, 6.75% due 1/01/2018                                                       20,816

A-      A           18,335    New York State Refunding, GO, Series B, 5.70% due 8/15/2010                         18,185

                              New York State Thruway Authority, General Revenue Bonds:
AAA     Aaa          2,500     Series A, 5.75% due 1/01/2019 (b)                                                   2,391
A       A1           4,000     Series A, 5.75% due 1/01/2019                                                       3,820
AAA     Aaa          7,500     Series C, 6% due 1/01/2015 (b)                                                      7,439
</TABLE>



<TABLE>
SCHEDULE OF INVESTMENTS (concluded)                                                                       (in Thousands)
<CAPTION>
S&P     Moody's    Face                                                                                          Value
Ratings Ratings   Amount                                  Issue                                                (Note 1a)

New York (concluded)
<S>     <S>       <C>         <S>                                                                               <C>
AAA     Aaa        $10,850    New York State Thruway Authority, Highway and Bridge Trust Fund,
                              Series B, UT, 6.25% due 4/01/2012 (b)                                             $ 11,136

BBB     Baa1         3,700    New York State Thruway Authority, Service Contract Revenue Bonds
                              (Local Highway and Bridge), 6% due 1/01/2011                                         3,622

                              New York State Urban Development Corporation Revenue Bonds:
BBB     Baa1         1,500     (Alfred Technology Resource Income Project), 7.875% due 1/01/2020                   1,615
BBB     Baa1        12,060     (Correctional Capital Facilities), Refunding, Series A, 5.25%
                               due 1/01/2021                                                                      10,239
BBB     Baa1         3,775     (Correctional Capital Facilities), Refunding, Series A, 5.50%
                               due 1/01/2014                                                                       3,403
BBB     Baa1         2,600     (Correctional Capital Facilities), Refunding, Series A, 5.50%
                               due 1/01/2016                                                                       2,333
BBB     Baa1        12,000     (Correctional Capital Facilities), Refunding, 5.50% due 1/01/2015                  10,785
BBB     Baa1         4,000     (State Facilities), 7.50% due 4/01/2020                                             4,288

                              Port Authority of New York and New Jersey, Consolidated Revenue Bonds:
AA-     A1           2,000     AMT, Seventy-Third Series, 6.75% due 4/15/2026                                      2,072
AA-     A1           8,345     AMT, Seventy-Sixth Series, 6.50% due 11/01/2026                                     8,509
AA-     A1           8,000     Sixty-Ninth Series, 7.125% due 6/01/2025                                            8,634

                              Triborough Bridge and Tunnel Authority, New York:
BBB     Baa1         3,150     (Convention Center Project), Series E, 7.25% due 1/01/2010                          3,457
A-      A1          10,550     (Special Obligations), Refunding, Series B, 6.875% due 1/01/2015                   11,161
<PAGE>
                              Triborough Bridge and Tunnel Authority, New York, Revenue Bonds
                              (General Purpose):
A+      Aa           6,000     Refunding, Series A, 5% due 1/01/2012                                               5,330
A+      Aa           5,000     Series X, 6.50% due 1/01/2019                                                       5,147

BBB     Baa          7,220    Ulster County, New York, Resource Recovery Agency Revenue Bonds
                              (Solid Waste Systems), 6% due 3/01/2014                                              6,653

NR*     A           15,100    United Nations Development Corp., New York, Revenue Refunding Bonds,
                              Senior Lien, Series A, 6% due 7/01/2026                                             14,562

AA-     Aa3          1,720    Westchester County, New York, Westchester, IDA, Airport Facility
                              Revenue Bonds (West Chester Airport Association), AMT, Series A,
                              5.95% due 8/01/2024                                                                  1,616

Total Investments (Cost--$563,871)--93.5%                                                                        586,402

Other Assets Less Liabilities--6.5%                                                                               40,769
                                                                                                                --------
Net Assets--100.0%                                                                                              $627,171
                                                                                                                ========


<FN>
(a)AMBAC Insured.
(b)FGIC Insured.
(c)MBIA Insured.
(d)Prerefunded.
(e)The interest rate is subject to change periodically based upon
   the prevailing market rate. The interest rate shown is the rate in
   effect at March 31, 1995.
(f)FHA Insured.
(g)FSA Insured.
 ++Highest short-term rating by Moody's Investors Service, Inc.
  *Not Rated.


See Notes to Financial Statements.
</TABLE>
<PAGE>


FINANCIAL INFORMATION


<TABLE>
Statement of Assets and Liabilities as of March 31, 1995
<S>                                                                                        <C>              <C>
Assets:             Investments, at value (identified cost--$563,870,889)(Note 1a)                          $586,401,998
                    Cash                                                                                       6,160,440
                    Receivables:
                      Securities sold                                                      $ 47,005,644
                      Interest                                                               10,412,830
                      Beneficial interest sold                                                  762,540       58,181,014
                                                                                           ------------
                    Prepaid registration fees and other assets (Note 1e)                                         109,688
                                                                                                            ------------
                    Total assets                                                                             650,853,140
                                                                                                            ------------

Liabilities:        Payables:
                      Securities purchased                                                   20,219,425
                      Beneficial interest redeemed                                            2,169,719
                      Dividends to shareholders (Note 1f)                                       531,421
                      Investment adviser (Note 2)                                               309,795
                      Distributor (Note 2)                                                      273,330       23,503,690
                                                                                           ------------
                    Accrued expenses and other liabilities                                                       178,615
                                                                                                            ------------
                    Total liabilities                                                                         23,682,305
                                                                                                            ------------

Net Assets:         Net assets                                                                              $627,170,835
                                                                                                            ============

Net Assets          Class A Shares of beneficial interest, $.10 par value,
Consist of:         unlimited number of shares authorized                                                   $    213,381
                    Class B Shares of beneficial interest, $.10 par value,
                    unlimited number of shares authorized                                                      5,488,534
                    Class C Shares of beneficial interest, $.10 par value,
                    unlimited number of shares authorized                                                         12,403
                    Class D Shares of beneficial interest, $.10 par value,
                    unlimited number of shares authorized                                                         11,711
                    Paid-in capital in excess of par                                                         631,960,612
                    Accumulated realized capital losses on investments--net                                  (19,452,957)
                    Accumulated distributions in excess of realized capital
                    gains--net                                                                               (13,593,958)
                    Unrealized appreciation on investments--net                                               22,531,109
                                                                                                            ------------
                    Net assets                                                                              $627,170,835
                                                                                                            ============
<PAGE>
Net Asset           Class A--Based on net assets of $23,368,106 and 2,133,809
Value:                       shares of beneficial interest outstanding                                      $      10.95
                                                                                                            ============
                    Class B--Based on net assets of $601,161,956 and 54,885,347
                             shares of beneficial interest outstanding                                      $      10.95
                                                                                                            ============
                    Class C--Based on net assets of $1,358,871 and 124,039
                             shares of beneficial interest outstanding                                      $      10.96
                                                                                                            ============
                    Class D--Based on net assets of $1,281,902 and 117,116
                             shares of beneficial interest outstanding                                      $      10.95
                                                                                                            ============



                    See Notes to Financial Statements.
</TABLE>



FINANCIAL INFORMATION (continued)


<TABLE>
Statement of Operations for the Six Months Ended March 31, 1995
<S>                                                                                                         <C>
Investment          Interest and amortization of premium and discount earned                                $ 20,527,216
Income                                                                                                      ------------
(Note 1d):

Expenses:           Investment advisory fees (Note 2)                                                          1,702,369
                    Distribution fees--Class B (Note 2)                                                        1,497,475
                    Transfer agent fees--Class B (Note 2)                                                        177,756
                    Printing and shareholder reports                                                              66,948
                    Accounting services (Note 2)                                                                  51,499
                    Registration fees (Note 1e)                                                                   42,060
                    Professional fees                                                                             36,970
                    Custodian fees                                                                                20,295
                    Trustees' fees and expenses                                                                   15,728
                    Pricing fees                                                                                   8,829
                    Transfer agent fees--Class A (Note 2)                                                          6,171
                    Distribution fees--Class C (Note 2)                                                            1,866
                    Account maintenance fees--Class D (Note 2)                                                       371
                    Transfer agent fees--Class C (Note 2)                                                            204
                    Transfer agent fees--Class D (Note 2)                                                            192
                    Other                                                                                          5,953
                                                                                                            ------------
                    Total expenses                                                                             3,634,686
                                                                                                            ------------
                    Investment income--net                                                                    16,892,530
                                                                                                            ------------
<PAGE>
Realized &          Realized loss on investments--net                                                        (19,452,957)
Unrealized Gain     Change in unrealized appreciation on investments--net                                     22,224,980
(Loss) on                                                                                                   ------------
Investments         Net Increase in Net Assets Resulting from Operations                                    $ 19,664,553
- --Net                                                                                                       ============
(Notes 1b,
1d & 3):



                    See Notes to Financial Statements.
</TABLE>



FINANCIAL INFORMATION (continued)


<TABLE>
Statements of Changes in Net Assets
<CAPTION>
                                                                                           For the Six        For the
                                                                                           Months Ended      Year Ended
                                                                                            March 31,        Sept. 30,
Increase (Decrease) in Net Assets:                                                             1995             1994
<S>                                                                                        <C>              <C>
Operations:         Investment income--net                                                 $ 16,892,530     $ 37,172,362
                    Realized loss on investments--net                                       (19,452,957)      (5,792,148)
                    Change in unrealized appreciation/depreciation on
                    investments--net                                                         22,224,980      (74,453,611)
                                                                                           ------------     ------------
                    Net increase (decrease) in net assets resulting from
                    operations                                                               19,664,553      (43,073,397)
                                                                                           ------------     ------------

Dividends and       Investment income--net:
Distributions         Class A                                                                  (720,294)      (1,758,497)
To Shareholders       Class B                                                               (16,134,553)     (35,413,865)
(Note 1f):            Class C                                                                   (16,339)              --
                      Class D                                                                   (21,344)              --
                    Realized gain on investments--net:
                      Class A                                                                        --         (299,209)
                      Class B                                                                        --       (6,828,149)
                      Class C                                                                        --               --
                      Class D                                                                        --               --
                    In excess of realized gain on investments--net:
                      Class A                                                                        --         (570,678)
                      Class B                                                                        --      (13,023,280)
                                                                                           ------------     ------------
                    Net decrease in net assets resulting from dividends and
                    distributions to shareholders                                           (16,892,530)     (57,893,678)
                                                                                           ------------     ------------
<PAGE>
Beneficial          Net increase (decrease) in net assets derived from
Interest            beneficial interest transactions                                        (49,242,653)       8,652,057
Transactions                                                                               ------------     ------------
(Note 4):

Net Assets:         Total decrease in net assets                                            (46,470,630)     (92,315,018)
                    Beginning of period                                                     673,641,465      765,956,483
                                                                                           ------------     ------------
                    End of period                                                          $627,170,835     $673,641,465
                                                                                           ============     ============



                    See Notes to Financial Statements.
</TABLE>



FINANCIAL INFORMATION (continued)


<TABLE>
Financial Highlights
                                                                                      Class A
The following per share data and ratios have been derived  For the Six
from information provided in the financial statements.     Months Ended
                                                            March 31,             For the Year Ended September 30,
Increase (Decrease) in Net Asset Value:                       1995         1994         1993          1992        1991
<S>                 <S>                                     <C>          <C>          <C>          <C>          <C>
Per Share           Net asset value, beginning of
Operating           period                                  $  10.88     $  12.46     $  11.77     $  11.22     $  10.56
Performance:                                                --------     --------     --------     --------     --------
                      Investment income--net                     .31          .64          .70          .72          .74
                      Realized and unrealized gain
                      (loss) on investments--net                 .07        (1.25)         .80          .55          .66
                                                            --------     --------     --------     --------     --------
                    Total from investment operations             .38         (.61)        1.50         1.27         1.40
                                                            --------     --------     --------     --------     --------
                    Less dividends and distributions:
                      Investment income--net                    (.31)        (.64)        (.70)        (.72)        (.74)
                      Realized gain on investments
                      --net                                       --         (.11)        (.11)          --           --
                      In excess of realized gain--net             --         (.22)          --           --           --
                                                            --------     --------     --------     --------     --------
                    Total dividends and distributions           (.31)        (.97)        (.81)        (.72)        (.74)
                                                            --------     --------     --------     --------     --------
                    Net asset  value, end of period         $  10.95     $  10.88     $  12.46     $  11.77     $  11.22
                                                            ========     ========     ========     ========     ========
<PAGE>
Total Investment    Based on net asset value per
Return:**           share                                      3.64%+++    (5.17%)      13.25%       11.77%       13.60%
                                                            ========     ========     ========     ========     ========


Ratios to Average   Expenses                                    .67%*        .63%         .64%         .65%         .66%
Net Assets:                                                 ========     ========     ========     ========     ========
                    Investment income--net                     5.90%*       5.52%        5.80%        6.28%        6.72%
                                                            ========     ========     ========     ========     ========

Supplemental        Net assets, end of period (in
Data:               thousands)                              $ 23,368     $ 28,301     $ 31,976     $ 18,973     $ 13,727
                                                            ========     ========     ========     ========     ========
                    Portfolio turnover                        90.70%      107.96%       38.31%       35.90%       49.78%
                                                            ========     ========     ========     ========     ========

                 <FN>
                   *Annualized.
                  **Total investment returns exclude the effect of sales loads.
                 +++Aggregate total investment return.

                    See Notes to Financial Statements.
</TABLE>



FINANCIAL INFORMATION (continued)


<TABLE>
Financial Highlights (continued)
<CAPTION>
                                                                                      Class B
The following per share data and ratios have been derived  For the Six
from information provided in the financial statements.     Months Ended
                                                            March 31,             For the Year Ended September 30,
Increase (Decrease) in Net Asset Value:                       1995         1994         1993          1992        1991
<S>                 <S>                                     <C>          <C>          <C>          <C>          <C>
Per Share           Net asset value, beginning of period    $  10.88     $  12.46     $  11.77     $  11.23     $  10.57
Operating                                                   --------     --------     --------     --------     --------
Performance:          Investment income--net                     .29          .58          .64          .67          .67
                      Realized and unrealized gain
                      (loss) on investments--net                 .07        (1.25)         .80          .54          .66
                                                            --------     --------     --------     --------     --------
                    Total from investment operations             .36         (.67)        1.44         1.21         1.33
<PAGE>                                                      --------     --------     --------     --------     --------
                    Less dividends and distributions:
                      Investment income--net                    (.29)        (.58)        (.64)        (.67)        (.67)
                      Realized gain on investments--
                      net                                         --         (.11)        (.11)          --           --
                      In excess of realized gain--net             --         (.22)          --           --           --
                                                            --------     --------     --------     --------     --------
                    Total dividends and distributions           (.29)        (.91)        (.75)        (.67)        (.67)
                                                            --------     --------     --------     --------     --------
                    Net asset value, end of period          $  10.95     $  10.88     $  12.46     $  11.77     $  11.23
                                                            ========     ========     ========     ========     ========

Total Investment    Based on net asset value per
Return:**           share                                      3.38%+++    (5.66%)      12.68%       11.12%       13.03%
                                                            ========     ========     ========     ========     ========


Ratios to           Expenses, excluding distribution
Average             fees                                        .68%*        .64%         .64%         .66%         .67%
Net Assets:                                                 ========     ========     ========     ========     ========
                    Expenses                                   1.18%*       1.14%        1.14%        1.16%        1.17%
                                                            ========     ========     ========     ========     ========
                    Investment income--net                     5.39%*       5.02%        5.32%        5.79%        6.23%
                                                            ========     ========     ========     ========     ========

Supplemental        Net assets, end of period (in
Data:               thousands)                              $601,162     $645,341     $733,981     $616,590     $568,958
                                                            ========     ========     ========     ========     ========
                    Portfolio turnover                        90.70%      107.96%       38.31%       35.90%       49.78%
                                                            ========     ========     ========     ========     ========


                 <FN>
                   *Annualized.
                  **Total investment returns exclude the effect of sales loads.
                 +++Aggregate total investment return.

                    See Notes to Financial Statements.
</TABLE>
<PAGE>


FINANCIAL INFORMATION (concluded)


<TABLE>
Financial Highlights (concluded)
<CAPTION>
The following per share data and ratios have been derived                                         For the Period
from information provided in the financial statements.                                          October 21, 1994++
                                                                                                to March 31, 1995
Increase (Decrease) in Net Asset Value:                                                     Class C          Class D
<S>                                                                                        <C>              <C>
Per Share           Net asset value, beginning of period                                   $      10.76     $      10.76
Operating                                                                                  ------------     ------------
Performance:          Investment income--net                                                        .25              .27
                      Realized and unrealized gain on investments--net                              .20              .19
                                                                                           ------------     ------------
                    Total from investment operations                                                .45              .46
                                                                                           ------------     ------------
                    Less dividends from investment income--net                                     (.25)            (.27)
                                                                                           ------------     ------------
                    Net asset value, end of period                                         $      10.96     $      10.95
                                                                                           ============     ============

Total Investment    Based on net asset value per share                                            4.26%+++         4.39%+++
Return:**                                                                                  ============     ============


Ratios to Average   Expenses, excluding account maintenance and distribution fees                  .69%*            .68%*
Net Assets:                                                                                ============     ============
                    Expenses                                                                      1.29%*            .78%*
                                                                                           ============     ============
                    Investment income--net                                                        5.25%*           5.78%*
                                                                                           ============     ============

Supplemental        Net assets, end of period (in thousands)                               $      1,359     $      1,282
Data:                                                                                      ============     ============
                    Portfolio turnover                                                           90.70%           90.70%
                                                                                           ============     ============


                 <FN>
                   *Annualized.
                  **Total investment returns exclude the effect of sales loads.
                 +++Aggregate total investment return.
                  ++Commencement of Operations.

                    See Notes to Financial Statements.
</TABLE>
<PAGE>

NOTES TO FINANCIAL STATEMENTS

1. Significant Accounting Policies:
Merrill Lynch New York Municipal Bond Fund (the "Fund") is part of
the Merrill Lynch Multi-State Municipal Series Trust (the "Trust").
The Fund is registered under the Investment Company Act of 1940 as a
diversified, open-end management investment company. These unaudited
financial statements reflect all adjustments which are, in the
opinion of management, necessary to a fair statement of the results
for the interim period presented. All such adjustments are of a
normal recurring nature. The Fund offers four classes of shares
under the Merrill Lynch Select Pricing SM System. Class A and Class D
Shares are sold with a front-end sales charge. Class B and Class C
Shares may be subject to a contingent deferred sales charge. All
classes of shares have identical voting, dividend, liquidation and
other rights and the same terms and conditions, except that Class B,
Class C and Class D Shares bear certain expenses related to the
account maintenance of such shares, and Class B and Class C Shares
also bear certain expenses related to the distribution of such
shares. Each class has exclusive voting rights with respect to
matters relating to its account maintenance and distribution
expenditures. The following is a summary of significant accounting
policies followed by the Fund.

(a) Valuation of investments--Municipal bonds and other portfolio
securities are traded primarily in the over-the-counter municipal
bond and money markets and are valued at the last available bid
price or yield equivalents as obtained from one or more dealers that
make markets in such securities. Financial futures contracts and
options thereon, which are traded on exchanges, are valued at their
last sale price as of the close of such exchanges. Short-term
investments with a remaining maturity of sixty days or less are
valued at amortized cost, which approximates market value.
Securities and assets for which market quotations are not readily
available are valued at fair value as determined in good faith by or
under the direction of the Board of Trustees of the Trust, including
valuations furnished by a pricing service retained by the Trust,
which may utilize a matrix system for valuations. The procedures of
the pricing service and its valuations are reviewed by the officers
of the Trust under the general supervision of the Trustees.

(b) Derivative financial instruments--The Fund may engage in various
portfolio strategies to seek to increase its return by hedging its
portfolio against adverse movements in the debt markets. Losses may
arise due to changes in the value of the con-tract or if the
counterparty does not perform under the contract.
<PAGE>
*   Financial futures contracts--The Fund may purchase or sell interest
rate futures contracts and options on such futures contracts for the
purpose of hedging the market risk on existing securities or the
intended purchase of securities. Futures contracts are contracts for
delayed delivery of securities at a specific future date and at a
specific price or yield. Upon entering into a contract, the Fund
deposits and maintains as collateral such initial margin as required
by the exchange on which the transaction is effected. Pursuant to
the contract, the Fund agrees to receive from or pay to the broker
an amount of cash equal to the daily fluctuation in value of the
contract. Such receipts or payments are known as variation margin
and are recorded by the Fund as unrealized gains or losses. When the
contract is closed, the Fund records a realized gain or loss equal
to the difference between the value of the contract at the time it
was opened and the value at the time it was closed.

(c) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required.

(d) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Interest income is recognized on the accrual
basis. Discounts and market premiums are amortized into interest
income. Realized gains and losses on security transactions are
determined on the identified cost basis.

(e) Prepaid registration fees--Prepaid registration fees are charged
to expense as the related shares are issued.

(f) Dividends and distributions--Dividends from net investment
income are declared daily and paid monthly. Distributions of capital
gains are recorded on the ex-dividend dates. Distributions in excess
of realized capital gains are due primarily to differing tax
treatments for futures transactions and post-October losses.

2. Investment Advisory Agreement and
Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with Fund
Asset Management, L.P. ("FAM"). The general partner of FAM is
Princeton Services, Inc. ("PSI"), an indirect wholly-owned
subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is the
limited partner. The Fund has also entered into a Distribution
Agreement and Distribution Plans with Merrill Lynch Funds
Distributor, Inc. ("MLFD" or "Distributor"), a wholly-owned
subsidiary of Merrill Lynch Group, Inc.
<PAGE>
FAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee based upon the average daily
value of the Fund's net assets at the following annual rates: 0.55%
of the Fund's average daily net assets not exceeding $500 million;
0.525% of average daily net assets in excess of $500 million but not
exceeding $1 billion, and 0.50% of average daily net assets in
excess of $1 billion. The Investment Advisory Agreement obligates
FAM to reimburse the Fund to the extent the Fund's expenses
(excluding interest, taxes, distribution fees, brokerage fees and
commissions, and extraordinary items) exceed 2.5% of the Fund's
first $30 million of average daily net assets, 2.0% of the next $70
million of average daily net assets, and 1.5% of the average daily
net assets in excess thereof. FAM's obligation to reimburse the Fund
is limited to the amount of the management fee. No fee payment will
be made to FAM during any fiscal year which will cause such expenses
to exceed the expense limitation at the time of such payment.

Pursuant to the distribution plans (the "Distribution Plans")
adopted by the Fund in accordance with Rule 12b-1 under the
Investment Company Act of 1940, the Fund pays the Distributor an
ongoing account maintenance fee and a distribution fee.

These fees are accrued daily and paid monthly at the annual rates
based upon the average daily net assets of the shares as follows:


                                           Account     Distribution
                                       Maintenance Fee      Fee

Class B                                     0.25%          0.25%
Class C                                     0.25%          0.35%
Class D                                     0.10%           --


Pursuant to a sub-agreement with the Distributor, Merrill Lynch,
Pierce, Fenner, and Smith Inc. ("MLPF&S"), a subsidiary of ML & Co.,
also provides account maintenance and distribution services to the
Fund. The ongoing account maintenance fee compensates the
Distributor and MLPF&S for providing account maintenance services to
Class B, Class C and Class D shareholders. The ongoing distribution
fee compensates the Distributor and MLPF&S for providing shareholder
and distribution-related services to Class B and Class C
shareholders.

For the six months ended March 31, 1995, MLFD earned underwriting
discounts and MLPF&S earned dealer concessions on the sales of the
Fund's Class A and Class D Shares as follows:
<PAGE>

                                         MLFD         MLPF&S

Class A                                  $596         $6,227
Class D                                  $282         $3,245


MLPF&S also received contingent deferred sales charges of $503,759
relating to transactions in Class B Shares for the six months ended
March 31, 1995.

Financial Data Services, Inc. ("FDS"), a wholly-owned subsidiary of
ML & Co., is the Fund's transfer agent.

Accounting services are provided to the Fund by FAM at cost.

Certain officers and/or trustees of the Fund are officers and/or
directors of FAM, MLPF&S, PSI, FDS, MLFD, and/or ML & Co.

3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the six months ended March 31, 1995 were $519,141,375 and
$622,908,564, respectively.


NOTES TO FINANCIAL STATEMENTS (concluded)

Net realized and unrealized gains (losses) as of March 31, 1995 were
as follows:


                                   Realized       Unrealized
                                     Losses         Gains

Long-term investments            $(17,367,499)   $22,531,109
Short-term investments                (22,891)            --
Financial futures contracts        (2,062,567)            --
                                 ------------    -----------
Total                            $(19,452,957)   $22,531,109
                                 ============    ===========


As of March 31, 1995, net unrealized appreciation for Federal income
tax purposes aggregated $22,531,109, of which $23,617,344 related to
appreciated securities and $1,086,235 related to depreciated
securities. The aggregate cost of investments at March 31, 1995 for
Federal income tax purposes was $563,870,889.
<PAGE>
4. Beneficial Interest Transactions:
Net increase (decrease) in net assets derived from beneficial
interest transactions was $(49,242,653) and $8,652,057 for the six
months ended March 31, 1995 and the year ended September 30, 1994,
respectively.

Transactions in shares of beneficial interest for each class were as
follows:


Class A Shares for the Six Months                   Dollar
Ended March 31, 1995                 Shares         Amount

Shares sold                           177,986   $  1,878,542
Shares issued to share-
holders in reinvestment of
dividends                              40,155        425,934
                                 ------------   ------------
Total issued                          218,141      2,304,476
Shares redeemed                      (686,472)    (7,221,616)
                                 ------------   ------------
Net decrease                         (468,331)  $ (4,917,140)
                                 ============   ============


Class A Shares for the Year                         Dollar
Ended September 30, 1994             Shares         Amount

Shares sold                           857,494   $ 10,076,116
Shares issued to share-
holders in reinvestment
of dividends and
distributions                         145,242      1,703,433
                                 ------------   ------------
Total issued                        1,002,736     11,779,549
Shares redeemed                      (967,073)   (11,024,027)
                                 ------------   ------------
Net increase                           35,663   $    755,522
                                 ============   ============


Class B Shares for the Six Months                   Dollar
Ended March 31, 1995                 Shares         Amount

Shares sold                         1,788,949   $ 19,003,320
Shares issued to share-
holders in reinvestment
of dividends and
distributions                         711,098      7,539,571
                                 ------------   ------------
Total issued                        2,500,047     26,542,891
Shares redeemed                    (6,941,115)   (73,400,466)
                                 ------------   ------------
Net decrease                       (4,441,068)  $(46,857,575)
                                 ============   ============
<PAGE>

Class B Shares for the Year                         Dollar
Ended September 30, 1994             Shares         Amount

Shares sold                         7,245,112   $ 85,135,787
Shares issued to share-
holders in reinvestment
of dividends and
distributions                       2,392,697     28,072,759
                                 ------------   ------------
Total issued                        9,637,809    113,208,546
Shares redeemed                    (9,213,059)  (105,312,011)
                                 ------------   ------------
Net increase                          424,750   $  7,896,535
                                 ============   ============

Class C Shares for the
Period October 21, 1994++ to                        Dollar
March 31, 1995                       Shares         Amount

Shares sold                           128,387   $  1,356,006
Shares issued to share-
holders in reinvestment of
dividends                                 894          9,650
                                 ------------   ------------
Total issued                          129,281      1,365,656
Shares redeemed                        (5,242)       (54,164)
                                 ------------   ------------
Net increase                          124,039   $  1,311,492
                                 ============   ============

[FN]
++Commencement of Operations.


Class D Shares for the
Period October 21, 1994++ to                        Dollar
March 31, 1995                       Shares         Amount

Shares sold                           157,554   $  1,644,142
Shares issued to share-
holders in reinvestment of
dividends                                 883          9,470
                                 ------------   ------------
Total issued                          158,437      1,653,612
Shares redeemed                       (41,321)      (433,042)
                                 ------------   ------------
Net increase                          117,116   $  1,220,570
                                 ============   ============
<PAGE>

[FN]
++Commencement of Operations.



OFFICERS AND TRUSTEES

Arthur Zeikel, President and Trustee
Herbert I. London, Trustee
Robert R. Martin, Trustee
Joseph L. May, Trustee
Andre F. Perold, Trustee
Terry K. Glenn, Executive Vice President
Donald C. Burke, Vice President
Vincent R. Giordano, Vice President
Kenneth A. Jacob, Vice President
Gerald M. Richard, Treasurer
Jerry Weiss, Secretary


Custodian
State Street Bank & Trust Company
P.O. Box 351
Boston, Massachusetts 02101

Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, Florida 32246-6484
(800) 637-3863



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